2019 Salary CertificationDivision of Financial Affairs

• Salary Certification is a component of the internal controls over compensation– Controls are required under 2 CFR 200: Uniform

Guidance (UG)– 2 CFR 200.430(i): Compensation – Personal Services

• This process focuses on the after-the-fact certification of salaries by position– For all individuals conducting activities supported by

sponsored projects, including Federal Capacity Funds.

Overview and Background

• Salary Certification complements, but does not replace, routine monitoring of accounts– Documented ongoing monitoring– Followed by mandatory documented year-end verification

• Per UG: “Short term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term.”– Salary transfers must be submitted timely when it is

recognized that effort component changes more than ±10%.

Ongoing Monitoring

• Costing allocations change when:– New projects begin– Projects are ending– A material, or sustained, change occurs in activity

• Prospective changes are updated in Workday• Pre-award accounts, along with future-dated

costing allocation changes in Workday, can reduce the need for salary transfers

Ongoing Monitoring

Faculty and/or Principal Investigators:• Summer salary - Is available only for project work performed

during the summer (5/16 – 8/15)– Should be requested prior to work being performed– Nine-month faculty do not receive paid vacation

• Institutional roles (e.g., chair or DGS duties) or indirect activities (e.g., proposal preparation) are not direct grant costs

• Effort Commitments– Are commitments being met?

• Reduction of PI effort by 25% or more (i.e. from 50% to 37.5%) typically requires sponsor approval.

– Is a person overcommitted?

Considerations: Faculty

National Institutes of Health (NIH) salary cap• Affects anyone paid all or in part on NIH funds who exceed the

following rates– CY2018: $142,200 (9 months) or $189,600 (12 months)– CY2019: $144,225 (9 months) or $192,300 (12 months)– Limitation on other Department of Health and Human Services

(DHHS) awards (e.g. CDC, FDA, HRSA, ACF)• Special rules for DHHS contracts

• Impacts both academic year and summer payments. – If summer pay is at a reduced rate, units should have

documentation stating such.

Considerations: Salary Cap

• This cost must be recorded in a cost share subaccount with “NIH CAP” in the title. – Workday costing allocation may require an update July 1 for

new earnings rates.– Cost sharing requirements (voluntary committed / mandatory),

are recorded in a separate cost share sub-account.• Tracked towards cost share obligation

Considerations: Salary Cap

• Only the stipend portion of payments to graduate assistants is reflected

• Per Policy 3.13, Graduate Tuition and Other Support, tuition must follow same distribution

Considerations: Graduate Students

• Administrative accounts used for federal work study subsidies. This occurs systematically and is overseen by the student employment staff.

• The supervisor is responsible for certifying the aggregate earnings between the departmental and administrative account as being reasonable compensation in relation to the work performed by the student.– There is no need to try to reconcile the charges on FWSCONT

or FWSENDW accounts

Accounts FWSCONT/FWSENDW

• Certified salaries must reasonably reflect actual effort on project– Excluding voluntary uncommitted cost shared salary

charged to university resources• Certifiers must have first hand knowledge of work performed

– Or suitable means of verification• Senior and key staff should know the project on which they

are working– And from what funds they are paid

Frequently Raised Concerns

• A person’s compensated activities on a position, including; teaching, committee memberships, administrative duties, etc. cannot exceed 100% and must be factored into the overall allocation of time

• Breaks in certification dilute integrity of the system of internal controls

Frequently Raised Concerns (continued)

• Salary Certification is performed after-the-fact.– Only for positions charged to sponsored activities, federal

appropriations, or cost share accounts/subaccounts.

• Only Cornell-compensated activities are included.– Some types of supplemental compensation, primarily for

allowances or reimbursements through payroll, may be excluded.

Cornell Process

• Units should be reviewing salary distribution throughout the year and making prospective changes in Workday.

• Salary Transfers (ST e-Docs) must be fully approved by June 30th. – Note: NO CHANGES TO STATE APPROPRIATIONS MAY BE MADE

AFTER THE JUNE 30TH SALARY TRANSFER APPROVAL DEADLINE.

• Year-End Salary Transfers (YEST e-Docs) must be submitted by Tuesday, July 16 at 3:00PM and fully approved by Tuesday, July 16 at 5:00PM for the changes to be included in the final reports.

• Subject to Policy 3.20, Cost Transfers on Sponsored Projects.

Timeline

• Preliminary FY19 reports distributed on Friday, May 10th.– For review only (not for certification)– FY19 Summer Salary will not be included

• Final reports will be distributed on Tuesday, July 30th which will include year-end salary transfers.– Main reports– Summer salary reports

Timeline

• Main reports will contain fiscal year salaries.– Header: FY19– Reports include all FY19 salary for the position with

the exception of object codes 5050, 5060, and 5460

• Faculty summer salary will be shown on a separate “Summer Salary” report.– Header: Summer FY19– Reports include all FY19 faculty summer salary

(object codes 5050 and 5060)

Report Structure

• Dropbox files have a maximum expiration date of 21 days. Download files and save to a secure location on your server as soon as you receive notice of the upload.

• If you did not receive a DropBox file, your org may have opted to use the CALS Salary Certification application.

• Please contact Beth Peet with the Employee ID and Position Number if you believe a report is missing from your org’s file.

• Email should not be used to share salary information.– Use Cornell Dropbox or CALS application to share these reports.

Dropbox Distribution or CALS Application

• The report is sent to the org for which the position is assigned in Workday.

• The receiving unit is responsible for coordinating the certification for all accounting lines on that position. This may require coordination with other administrators.

• Please contact us immediately if you believe a report has been assigned to your org in error, so that we may determine who should certify the report.

Why did I receive a report that includes accounts that are not assigned to my org?

Make any necessary data changes BEFORE the reports are signed because the certifying signature attests that all information correctly represents the employee’s activity during the preceding fiscal year.

– For distribution changes not reflected on final report, the salary distribution must be updated.

– If a new account needs to be added, populate each column.– Must still total 100% and total dollars must not change.– Write corresponding Salary Transfer edoc nbr on the report.

Cost transfers require additional supporting documentation to substantiate the transfer (University Policy 3.20)

Certification Process

Who signs the salary certification report?• Reports can be certified by anyone either having

first-hand knowledge that the account distribution represented on the report is reasonable in relation to the work that was performed.

• Reports can be certified by someone using “suitable means of verification” from someone else having first-hand knowledge.

Certification Process

Suitable means of verification as defined in Policy 3.11:

– The process through which one receives assurance that effort was provided as stated so that an effort certification may be approved by an individual not having firsthand knowledge.

– Suitable means of verification requires the documented review by an individual, such as the PI, project manager, supervisor, or an employee who has first-hand knowledge that the work was performed.

Extraneous comments or marks should not be included on the report that will be the official record of certification.

• All notations made on the report are subject to review by DFA, agencies, and auditors.

• If notes make it easier to discuss distribution with PIs, consider making an additional copy for your discussion and have the PI sign a clean report if no post-report changes need to be made.

Certification Process

• If your org chooses the group certification method rather than certifying reports individually, use the Group Certification Form as a cover page when you return the reports.

• Use the Group Certification Form ONLY FOR THE PURPOSE OF GROUP CERTIFICATION.

• All reports for the org that is being certified need to be returned with the group certification cover page. Reports must follow the group certification cover page sequentially.

• If you are certifying for more than one org, a group certification page needs to be completed for each org that you are group certifying.

Group Certification

• Be sure to select the “suitable means of verification”. You are responsible for keeping all supporting documentation of your verification on file in your unit for six full fiscal years.

Group Certification

• DFA may perform after-the-fact reviews to validate the use of suitable means.

The organization name for the group certification must match the organization name in the header of the org’s reports.

Group Certification

Electronic files for group certifications will be accepted this year if the certification is digitally signed with a CERTIFICATE SIGNATURE issued by a certificate authority.

E.g. Certificate signature tool provided in Adobe Acrobat Additional requirements must be met to submit electronic files: Reports must be legible and presented in the correct orientation

and numbering sequence following the group certification page. All reports issued for the org must be included in the file. If backup documentation is provided, it must immediately follow

the report it supports. Electronic files can only be returned via the Cornell DropBox.

Certification Process

Cornell DropBox URL - https://dropbox.cornell.edu/ Certification Process

Files with certificate signatures cannot be modified by parties other than the certifier, therefore electronic files will be accepted only if the following conditions are fulfilled:Group certification cover page is digitally signed with a

CERTIFICATE SIGNATURE issued by a certificateauthority.

Reports must be legible and presented in the correctorientation.

All reports issued for the org must be included in the file andfollow the group certification cover page in the correctnumbering sequence.

If backup documentation is provided, it must immediatelyfollow the report it supports.

Certification Process

Hard copy reports will be scanned on receipt by DFA. Please assist with this process by observing the following:• Return all certified pages in order based on the page

number at the bottom right side of the report.• Supporting documentation should follow directly behind

the report it supports.• If the report is printed double-sided, be sure that the report

on the flip side is sequential.• If you send a non-sequential file to a PI it is important that

the PI print it single sided.

Certification Process

Checklist prior to returning hard copy reports:

Confirm that each page is signed and dated in the designated field at the bottom of the report if reports are certified individually.

Confirm that each page is arranged in sequential order according to the page number at the bottom right of the report. All pages in the file you received need to be returned, including group certified reports.

Confirm that any necessary backup documentation follows directly behind the report that it supports.

Certification Process

Reports filed in DFA must be certified either with hard-ink signature and date or certificate signature on e-files with group certification.

When a PI is out-of-town or it is otherwise impractical to obtain an original signature, a scanned document of sufficient quality is acceptable.

Copies of the originals along with any back-up of the verification process should be retained in the unit.

Certification Process

Completed certifications must be received in DFA no later than Friday, August 30, 2019.

• Hard files via campus mail to the attention of Beth Peet, SFS/DFA, 341 Pine Tree Rd.

• E-files via the Cornell DropBox to eap2

DFA will notify appropriate officers (e.g. unit heads, college business officer) when certifications are delinquent.

Certification Process

A salary transfer moving sponsored salary after a report has been certified results in a nullification of the original attestation or a “break in certification.”

• This includes any ST that transfers certified salary to/from a sponsored project.

• Even if the new project (OSP number) is a continuation award, it is still a break in certification.

• Linked projects and associated projects under an umbrella are considered separate projects. Moving salary between the projects after salary is certified is a break in certification.

Breaks in Certification

Breaks in certification are an area of high audit scrutiny and require additional documentation.• The previously certified report needs to be modified to reflect

the salary transfer and recertified with signature and date.

• A letter of explanation must be provided with the updated report to document why the prior certification was not certified correctly the first time.Include the doc number of the Salary Transfer in the letter.

• Send the updated, recertified report and the letter of explanation to SFS/QA when the ST is submitted.

Breaks in Certification

• A comment will be added to the official archived record noting the change between non-sponsored accounts with a reference to the ST doc number.

• The same comment should be added to the copy the department has retained.

• The report does NOT need to be recertified in these cases.

Salary Transfers that do not affect sponsored accounts…

Per Policy 3.20, a Late Cost Transfer is one requested 90 days or more after the original transaction posted.

• The transfer request must include a valid reason for the delay and is normally permitted only under extenuating circumstances.

• If lateness is due to administrative delay, explain the corrective action addressed to prevent future recurrence.

• An Error Certification tab on the Salary Transfer edoc is available to provide substantiation for all cost transfers.

Late Cost Transfers

University Policy 3.20 Cost Transfers on Sponsored Agreements

• Annual Certification Process– https://www.dfa.cornell.edu/capitalassets/cost/effort

• Policy 3.11, Salary Certification Policy– https://www.dfa.cornell.edu/policy/policies/salary-confirmation

• Policy 3.20, Cost Transfers on Sponsored Agreements– https://www.dfa.cornell.edu/policy/policies/cost-transfers-sponsored-

agreements• Part 200- Uniform Administrative Requirements, Cost Principles,

and Audit Requirements for Federal Awards (Uniform Guidance) – https://www.ecfr.gov/cgi-bin/text-

idx?SID=704835d27377ef5213a51c149de40cab&node=2:1.1.2.2.1&rgn=div5

References

AcronymsAcronym MeaningACF The Administration for Children and Families

CDC Centers for Disease Control and Prevention

CFR Code of Federal Regulations

DFA Division of Financial Affairs

DGS Director of Graduate Studies

DHHS U.S. Department of Health $ Human Services

FDA U.S. Food & Drug Administration

HRSA U.S. Health Resources & Services Administration

KFS Kuali Financial System

Org Organization

OSP Office of Sponsored Programs

PI Principal Investigator

SFS Sponsored Financial Services

SFS/QA Sponsored Financial Services/Quality Assurance

ST Salary Transfer

Sponsored Financial Services• Beth Peet, eap2@cornell.edu, 607 255-3351• Janet Strait, janet.strait@cornell.edu, 607 255-

1482

Assistance/Questions

Questions?